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A Chinese world order

Loans from China helped Uganda build a speedy new road to its main airport. (Reuters)

Jonathan Hillman is director of the Reconnecting Asia Project at the Center for Strategic and International Studies in Washington, D.C.

BUDAPEST — Earlier this month, 16 Central and Eastern European heads of state assembled around a single foreign power in Sofia, Bulgaria. The convening force was not the European Union, Russia or the United States, which historically have the deepest cultural, political and security ties in this region. Instead, China was at the center — as it increasingly is around the world.

Now in its seventh year, the “16+1” summit perfectly captures China’s deceptive brand of multilateralism. Bringing together many countries, it gives the outward appearance of inclusivity and consensus-building. Official statements at the summit affirmed support for the World Trade Organization and the United Nations, two genuine pillars of multilateralism that are increasingly under strain. “We need to uphold multilateralism,” Chinese Premier Li Keqiang told attendees.

But beneath the surface, China’s 16+1 format is fundamentally different from the multilateral practices and institutions it claims to uphold. China and its partners do not subscribe to a common set of rules that has any significant impact on their behavior. Nor is anything of consequence done by consensus. China’s multilateralism lacks depth, and it relies on stroking egos and dangling bilateral deals. Call it “flatteralism.”

Where this approach has benefits, they mostly accrue to China. Under the guise of broader participation, China favors governments where investment rules are less strict, ensuring Chinese companies are hired to build large projects. For example, Bosnia’s economy is roughly one-third the size of Croatia’s, but it is not subject to E.U. procurement rules that require open bidding. Last year, it received ten times as much Chinese investment, according to data collected by the Center for Strategic and International Studies.

There are practical and political advantages as well. These annual gatherings allow Chinese officials to efficiently lavish high-level attention on smaller economies. And when China comes to town, its summits are less board meetings than auditions. The 16 countries essentially compete for the attention of the one. China uses variations of this model elsewhere, positioning itself at the center of summits in Africa and Latin America. This is adept diplomacy, but it is not multilateralism.

Flatteralism also runs through Chinese President Xi Jinping’s signature foreign policy vision. Unveiled in 2013, China’s Belt and Road initiative aims to move Beijing close to the center of everything through new hard infrastructure projects, trade deals, cultural exchanges and a multitude of other connections. “Together, we can build a broad community of shared interests,” Xi told an audience of nearly 30 heads of state and representatives from more than 130 countries and 70 international organizations in Beijing last year.

The Belt and Road is a masterstroke in geopolitical advertising. Wrapping the effort in Silk Road mythology, Xi is effectively selling a Sino-centric order to the world. Rather than cringing at maps that depict all roads leading to Beijing, roughly 70 countries have signed onto the effort. The United Nations, WTO and other traditional standard-bearers of multilateralism have all expressed varying degrees of support for an effort that could further erode their effectiveness.

In practice, the Belt and Road is a sea of bilateral deals between China and participating countries, including many markets where few others dare to go. More than half of the countries participating in the Belt and Road have sovereign debt ratings that are either junk or not graded. China’s emphasis on building big-ticket infrastructure projects resonates with foreign leaders looking to impress at home and establish a legacy.

Ribbon cutting ceremonies are difficult for leaders to resist, and as the deals pile up, development can give way to dependency. In a former Sri Lankan president’s home district, major projects — including an international airport, a cricket stadium and a port — had three things in common: they used Chinese financing, Chinese contractors and his name. Now they are barely used, Sri Lanka has crushing debt, and China has control of the port.

Praise flows freely along the Belt and Road. China touts an “all-weather strategic” partnership with Pakistan, a “comprehensive strategic partnership” with Russia, a “comprehensive strategic cooperative partnership” with Vietnamand “strategic cooperative” relationships with a long list of neighbors. It has become the Baskin-Robbins of partnerships, offering flavors for everyone.

But what China has yet to offer is deep multilateralism at scale. Its closest attempt, the Asian Infrastructure Investment Bank, has attracted broad participation and adopted rules similar to those of the World Bank. But having lent only $5 billion to date, the AIIB is easily overshadowed by Beijing’s bilateral lending mechanisms. Over the next five years, the China Development Bank has committed to invest $250 billion in countries along the Belt and Road.

Less than a week after China’s 16+1 summit, NATO heads of state gathered in Belgium. Normally, a meeting of the world’s most powerful collective security alliance would provide a stark contrast to Beijing’s shallow summitry. But in the absence of strong U.S. support for authentic multilateralism, it is becoming more difficult to spot imposters.

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